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2019-04-20 12:51:40

HUM

Humana

$240.65

7.645 (3.28%)

, CI

Cigna

$148.95

3.46 (2.38%)

…12:51

04/20/19

04/20

12:51

04/20/19

12:51

Health insurers stocks now look like a buy, Barron's says

Investing in health insurers today amounts to a bet against the Medicare for All proposal championed by Senator Bernie Sanders and other Democrats running for president, Andrew Bary writes in this week's edition of Barron's. While the stocks have been battered, given the long odds of an industry-killing plan becoming law, shares of the leading insurers - UnitedHealth (UNH), Anthem (ANTM), Cigna (CI), Humana (HUM) and CVS (CVS) - look appealing, Bary contends. The stocks trade for an average of just 12 times projected 2019 earnings and UnitedHealth, Anthem, and Humana already are generating double-digit growth in earnings per share, he adds. Reference Link

SVB Leerink analyst Ana Gupte believes Medicare-For-All risk is overblown, not the same as 2008/09, and recommends investors step in now to buy MCOs. The analyst believes it is a "once in a decade opportunity" to get high quality names at these depressed multiples, with UnitedHealth (UNH), Anthem (ANTM), and Humana (HUM) being her favorites.

Stephens analyst Scott Fidel noted that the managed care group has sharply underperformed the S&P 500 over the last month amid "political rhetoric" around point-of-sale drug rebates and Medicare for all policy proposals, though he believes the issues facing the sector right now "seem modest in comparison" to the "dark days of 2008-2010." While recent Medicare for all proposals have rattled investors, "they will face enormous uphill battles," Fidel tells investors. Hospital stocks have outperformed MCOs year-to-date, but the group declined about 9% yesterday and underperformed the MCO group, which Fidel attributes to acknowledgement by industry bellwether UnitedHealth (UNH) of the significant disruptive nature of Medicare for all, which may have sparked additional fears, as well as one less calendar day being called out by UnitedHealth as benefiting Q1 MLRs and Johnson & Johnson's (JNJ) earnings call commentary on declining sequential hospital admissions from Q4. Publicly traded companies in the hospital space include Community Health (CYH), HCA Healthcare (HCA), LifePoint (LPNT), Tenet (THC) and Universal Health (UHS). Publicly traded companies in the managed care space include Anthem (ANTM), CVS Health (CVS), Centene (CNC), Cigna (CI), Health Net (HNT), Humana (HUM), Molina Healthcare (MOH), UnitedHealth (UNH) and WellCare (WCG).

04/10/19

CANT

04/10/19NO CHANGECANT

Senate hearing a net positive for PBMs, says Cantor Fitzgerald

Cantor Fitzgerald analyst Steven Halper views yesterday's Senate hearing as a net positive for the pharmacy benefit managers. The PBMs represented were Cigna (CI), CVS Health (CVS), UnitedHealth (UNH), Humana (HUM) and Prime Therapeutics. Although the Senators were not supportive of the PBMs, the executives responded well to questions and put forth a solid effort to address concerns regarding their business model and incentives, Halper tells investors in a research note. Overall, he views the hearing as a net positive for PBMs "as the group was able to counter the negative sentiment with constructive responses, recognizing this story is far from over."

04/05/19

COWN

04/05/19NO CHANGECOWN

Centene, Molina could be 'compelling' targets for Humana, says Cowen

Cowen analyst Charles Rhyee said he believes Centene's (CNC) planned takeover of WellCare (WCG) could potentially accelerate Humana's (HUM) timeline to acquire a scaled Medicaid asset, noting that it currently has the second smallest Medicaid book among managed care organizations. His analysis suggests Centene and Molina Healthcare (MOH) could both be "compelling acquisition targets" for Humana and believes the company has the financial capacity to make a bid for either, though Rhyee added that he does not believe Humana needs to rush a decision. Rhyee sees about a one year window in which Humana "can dictate the Medicaid M&A market" before Cigna (CI) and/or CVS Health (CVS) can get involved, he tells investors. While the analyst believes Centene makes the most sense as a potential target for Humana if the latter does not win the Texas STAR+PLUS contract, he suspects Centene is not willing to sell and believes Humana would have to offer a significant premium. If Humana does win the Texas STAR+PLUS contract it does not need to pursue large scale M&A, but a deal could be attractive anyway, Rhyee said.

CICigna

$148.95

3.46 (2.38%)

03/29/19

03/29/19DOWNGRADE

WellCare downgraded to Hold at Argus on Centene merger

Argus analyst David Toung downgraded WellCare (WCG) to Hold after it agreed to be acquired by Centene (CNC) in a $17.3B deal or at $305.39 per share. The analyst notes that because the deal would yield an entity that is smaller than the insurance industry giants, it may receive a more favorable treatment from the regulators than the failed Aetna (AET) -Humana (HUM) and Anthem (ANTM)-Cigna (CI) deals, but warns that some antitrust scrutiny is still possible due to overlaps between the companies in a few states. Toung adds that the new company would have "strengths in Medicare Advantage and Medicaid, both of which are growing markets."

Goldman Sachs analyst Stephen Tanal noted that Politico reported that a federal judge ruled for the second time to block new work requirements as a condition for Medicaid eligibility in Kentucky and Arkansas, calling the ruling an incremental positive for Managed Care and Provider companies. MCOs whose primary business is Medicaid managed care are most exposed to this theme, said Tanal, who lists Molina (MOH), WellCare (WCG) and Centene (CNC) as three with a higher percentage of MMC lives in states that have submitted waivers requesting approval to impose work requirements. However, the analyst also noted that Kentucky's Governor has already issued an executive order indicating the state would appeal any decision by a court against work requirements and, if unsuccessful, would reverse its Medicaid Expansion program. WellCare, CVS' (CVS) Aetan, Humana (HUM) and Anthem (ANTM) all operate in Kentucky's Medicaid managed care program, the analyst noted.

RBC Capital analyst Frank Morgan says he's found no company specific news that would explain the weakness today in shares of eHealth. Rather, the analyst attributes the 22% pullback to continued selling in managed care operators and providers, which began yesterday morning. He attributes yesterday's sell-off to Democratic presidential candidate rhetoric around Medicare-for-All, including a tweet from candidate Bernie Sanders during UnitedHealth's Q1 earnings call advocating for MFA. Morgan believes investors were looking to take profits in any strong year-to-date performers, like eHealth. The analyst has an Outperform rating on the stock with an $83 price target. eHealth in afternoon trading is down 22%, or $14.05, to $51.38.

04/17/19

JPMS

04/17/19NO CHANGETarget $235JPMSNeutral

JPMorgan lowers UnitedHealth target to $235 on 'sustainable' political risk

JPMorgan analyst Gary Taylor last night lowered his price target for UnitedHealth to $235 from $301 following the company's Q1 earnings report. The reduction is due to "renewed and sustainable Election year political risk," particularly around leading Democrats' plans for single-payor Medicare-For-All plans, Taylor tells investors in a research note. The analyst, however, does not believe UnitedHealth said anything fundamentally negative on the earnings call to justify the corresponding stock selloff. The analyst attributes the reversal in trading yesterday's to renewed and continuing Medicare-For-All political fears. He keeps an Overweight rating on shares of UnitedHealth. The stock in morning trading is down 3%, or $7.64, to $213.32.

CVSCVS Health

$52.62

0.08 (0.15%)

04/17/19

GUGG

04/17/19INITIATIONGUGGBuy

CVS Health assumed with a Buy at Guggenheim

Guggenheim analyst Glen Santangelo assumed coverage of CVS Health with a Buy rating and $63 price target, lowered from a previous price target of $85. The analyst is "excited about the strategic repositioning of the company and the long-term opportunities for the new model," but noted that he "underestimated the structural and integration issues facing the business." That said, Santangelo believes that much of the damage to the stock is already done, and believes CVS Health is a good fit for long-term investors that can handle near-term volatility.

Piper Jaffray analyst Sean Wieland is "incrementally more positive" on Tabula Rasa HealthCare's (TRHC) growth outlook after traveling with the company's CFO Brian Adams. CVS Health (CVS) provides a "strong validation" of Tabula Rasa's value proposition, and multiple opportunities should result in a higher margin product mix, Wieland tells investors in a research note. Further, the analyst believes the recent weakness in the stock has created a "compelling entry point." He reiterates an Overweight rating on Tabula Rasa HealthCare with a $73 price target.

04/15/19

04/15/19DOWNGRADE

Fly Intel: Top five analyst downgrades

Catch up on today's top five analyst downgrades with this list compiled by The Fly: 1. CVS Health (CVS) downgraded to Perform from Outperform at Oppenheimer with analyst Michael Wiederhorn saying he views it as more of a long-term opportunity given the potential timeline to execute on its strategy and the near-term legacy business challenges. 2. Infosys (INFY) downgraded to Hold from Buy at Deutsche Bank and Investec, to Reduce from Neutral at Nomura Instinet, to Underperform from Neutral at Credit Suisse, to Equal Weight from Overweight at Morgan Stanley, and to Neutral from Buy at Citi and BofA/Merrill. 3. Celanese (CE) downgraded to Hold from Buy at Deutsche Bank with analyst David Begleiter saying the company's leadership transition creates uncertainty. 4. Alliance Data (ADS) downgraded to Underweight from Equal Weight at Stephens and to Market Perform from Outperform at BMO Capital. 5. Wells Fargo (WFC) downgraded to Neutral from Conviction Buy at Goldman Sachs, to In Line from Outperform at Evercore ISI, and to Neutral from Buy at BofA/Merrill and Buckingham. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

According to a regulatory filing, Ryan Graves informed Uber Technologies of his intention to resign as a member of the company's board of directors, effective as of May 27, 2019, including any committees of the board of directors on which he serves. Graves' resignation was not the result of any disagreement between Graves and the company, its management, board of directors or any committee thereof, or with respect to any matter relating to the company's operations, policies or practices, according to the filing.

U.S. Energy announced that on May 21, Nasdaq notified the company that as a result of not having received its Quarterly Report on Form 10-Q for the period ended March 31. 2019, and because the company is delinquent in filing its Form 10-K for the year ended December 31, 2018, the company does not comply with the requirements of Nasdaq Listing Rule 5250(c)(1) for continued listing on the Exchange. This notification has no effect on the listing of the company's common stock at this time. However, pursuant to the notice, the company was required to submit a plan by May 23, 2019 to comply with the Exchange's requirements for continued listing.

Apple is being sued by customers alleging that the U.S. tech giant is unlawfully disclosing and selling information about users' iTunes purchases as well as their personal data, Bloomberg's Robert Burnson reports. The customers claim that such alleged practices are contrary to Apple's promise in advertising that "What happens on your iPhone stays on your iPhone," Burnson notes. Reference Link

SuperCom received a notification from Nasdaq for not having timely filed its Annual Report on Form 20-F for the year ended December 31, 2018, as previously disclosed by the company on May 16, 2019. The company does not comply with the Nasdaq Listing Rule 5250(c)(1). This notice from Nasdaq has no effect currently on the listing of the company's common stock on the Nasdaq Capital Market.

U.S. Energy announced that Nasdaq notified the company that as a result of not having received the company's quarterly report on Form 10-Q for the period ended March 31 and because the company is delinquent in filing its Form 10-K for the year ended December 31, 2018, the company does not comply with the requirements of Nasdaq Listing Rule 5250 for continued listing on the exchange. This notification has no effect on the listing of the company's common stock at this time. However, pursuant to the notice, the company was required to submit a plan by May 23 to comply with the exchange's requirements for continued listing. The company has submitted the plan to the exchange. If the exchange accepts the company's Plan, the exchange may grant an exception of up to 180 calendar days from the Form 10-K's due date, or until October 14 to regain compliance. The company continues to work toward the filing of the Form 10-Q and the Form 10-K with the SEC as soon as practicable.

Qiagen (QGEN) announced the launch of its therascreen PIK3CA RGQ PCR Kit after it received U.S. regulatory approval as a companion diagnostic to aid in identifying breast cancer patients eligible for treatment with PIQRAY, a newly approved therapy developed and marketed by Novartis (NVS). The therascreen PIK3CA Kit is the first companion diagnostic assay to obtain premarket approval from the FDA for use in any cancer indication for detection of activating mutations in the PIK3CA gene. It is also the first FDA approved assay for guiding treatment decisions in breast cancer using plasma specimens as a liquid biopsy.

Brazil's ANAC said it has suspended all flights and operations of Avianca Brasil in the South American nation as a precuartionary measure, Reuters reports. The move follows Avianca's filing for bankruptcy in late 2018, the report says. "All the flights are suspended until the company proves it has the capacity to maintain operations safely," ANAC said. Reference Link

Apple has bought Tueo Health, a start-up that was making a system to help parents monitor asthma symptoms in sleeping kids, CNBC's Christina Farr and Steve Kovach report, citing a person familiar with the deal. It is not clear how much the U.S. tech giant paid for the start-up, the authors note. Reference Link

A review of Boeing's grounded 737 MAX aircraft has expanded to include emergency procedures used by pilots on earlier models of the plane, further delaying its return to service, the Wall Street Journal's Andy Pasztor reports, citing U.S. government officials. The FAA hasn't questioned the safety of older aircraft currently in service, but the broadened review will play a major role in adding months to the time expected to get the grounded fleet of 737 MAX jets back in the skies, Pasztor notes. As part of the FAA's safety analysis of a proposed software fix for the fleet, the agency is also weighing changes to how pilots of the entire 737 family are trained to respond when the flight-control computer or other systems suddenly push the jet's nose down, the author says. Reference Link

The CBOE Volatility Index (VIX), the SPX option derived measure of implied volatility, fell 1.07 today to close at 15.85, while the underlying SPX index gained 3.82 to close at $2826.06, a 0.14% increase. 274,267 VIX option contracts traded, 38.73% of the typical daily volume for the product. Calls made up 74.0% of the volume.

Volume was average for this time of day. Breadth was mixed with issues and volume bullish while new highs to new lows were bearish (negative divergence). Advancing Issues: 2009 / Declining Issues: 1048 -- for a ratio of 1.9 to 1. Advancing Volume: 915,942,000 / Declining Volume: 681,710,000 -- for a ratio of 1.3 to 1. New 52-Week Highs: 57 / New 52-Week Lows: 114.

Volume was below average for this time of day. Breadth was bullish across the board. Advancing Issues: 1963 / Declining Issues: 956 -- for a ratio of 2.1 to 1. Advancing Volume: 1,549,354,000 / Declining Volume: 986,891,000 -- for a ratio of 1.6 to 1. New 52-Week Highs: 138 / New 52-Week Lows: 89.

Regional Health Properties, Inc. announcement concerning the company's noncompliance with the continued listing standards of NYSE American LLC. On May 21, 2019, the company received an official notice of noncompliance from the Exchange stating that the company is not in compliance with the Exchange's continued listing standards under the timely filing criteria outlined in Section 1007 of the Exchange's company Guide because the company failed to timely file its Quarterly Report on Form 10-Q for the period ended March 31, 2019, which was due to be filed with the Securities and Exchange Commission no later than May 20, 2019. For the reasons previously disclosed in its Form 12b-25 filed with the Securities and Exchange Commission on May 16, 2019, the company has not timely filed the Delayed Form 10-Q because additional time is needed to finalize the Delayed Form 10-Q and furnish the XBRL Interactive Data File exhibits required by Item 601b101 of Regulation S-K. The company is actively working to complete the Delayed Form 10-Q and intends to file the Delayed Form 10-Q under the Securities Exchange Act of 1934, as amended, within the next thirty days. As a result of the foregoing, the company has become subject to the procedures and requirements of Section 1007 of the Company Guide. During the six-month period from the date of the Filing Delinquency, the Exchange will monitor the company and the status of the Delayed Form 10-Q and any subsequent reports until the Filing Delinquency is cured. If the company fails to cure the Filing Delinquency within the Initial Cure Period, the Exchange may, in its sole discretion, allow the company's securities to be traded for up to an additional six-month period, depending on the company's specific circumstances. If the Exchange determines that an Additional Cure Period is not appropriate, suspension and delisting procedures will commence in accordance with the procedures set forth in Section 1010 of the Company Guide.